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Wednesday, September 21, 2016

State debt a pending national financial crisis

States across the country are massively in debt and must be held accountable

Government transparency and accountability are two issues surfacing this election. Well-known examples include Donald Trump’s resistance to releasing his tax returns, Secretary Hillary Clinton’s murky answers about her private email server and both of their resistance to releasing comprehensive health-related files. In addition to the presidential election, but not receiving as much attention, state-based politicians and government officials are also struggling with transparency and accountability producing inaccurate financial reports and making downright false claims. These actions, state-by-state and taken as a whole, are leading us toward a significant, national crisis.

Across the country, states have racked up $1.3 trillion in debt. In fact, 80 percent of states are in debt, meaning 40 out of 50 states do not have enough money to pay their bills. Yet every state, except for Vermont, has balanced budget requirements. Seems contradictory, right?

The worst offenders include New Jersey, Connecticut, Illinois, Massachusetts and Kentucky. The taxpayer burdens — or the amount each taxpayer would need to pay the state’s treasury in order for the state to be debt-free — for these states are massive. New Jersey has the highest taxpayer burden with each taxpayer owing $59,400; Connecticut has the second highest with each taxpayer owing $49,000; and Illinois has the third highest with each taxpayer owing $45,500. How long until one of these states is in the next Puerto Rico situation, requiring a federal bailout?